Private equity firm Ascent Capital Advisors-backed Radiant Cash Management Services has filed the Draft Red Herring Prospectus with capital markets regulator Sebi to raise funds via initial public offering.
The IPO comprises a fresh issue of Rs 60 crore, and an offer for sale of over 3.0125 crore equity shares by promoter and investor.
Promoter Colonel David Devasahayam is going to sell up to 1.0125 crore equity shares and private equity firm Ascent Capital Advisors India will offload 2 crore equity shares through offer for sale route.
The company intends to utilise net proceeds from fresh issue for working capital requirements (Rs 20 crore), and capital expenditure (Rs 23.92 crore) besides general corporate purposes.
Ascent Capital Advisors India holds 37.21 percent (3.76 crore equity shares) stake in Radiant Cash Management Services and its average price of acquisition of these shares is Rs 21.23 per equity share, as per the information provided in the prospectus.
Promoters Colonel David Devasahayam and Dr. Renuka David together have 62.79 percent shareholding in the company.
Founded in 2005 by Colonel David Devasahayam, Radiant Cash Management Services is an integrated cash logistics player with leading presence in retail cash management (RCM) segment of the cash management services industry in India and is one of the largest players in the RCM segment in terms of network locations or touch points served as of July 2021.
It operates business across five verticals – cash pick-up and delivery; network currency management (also known as cash burial in industry parlance); cash processing; cash vans /cash in transit and other value added services.
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Its marquee clients include some of the largest foreign, private and public sector banks (Axis Bank, Citibank, Deutsche Bank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Standard Chartered Bank, State Bank of India, The Hongkong and Shanghai Banking Corporation, and Yes Bank), and the end user of its services include some of the largest e-commerce companies, retail chains, NBFCs, insurance firms, ecommerce logistics players, railways and retail petroleum distribution outlets.
As of July 2021, it provided services across 12,150 pin codes in India covering all districts (other than Lakshadweep) with about 42,420 touch points serving more than 4,700 locations.
Radiant Cash Management Services reported revenue from operations at Rs 221.67 crore during the year ended March 2021 against Rs 248.28 crore in FY20 and Rs 220.9 crore in FY19, while its profit after tax in the same year stood at Rs 32.43 crore against Rs 36.5 crore in FY20 and Rs 25 crore in FY19.
As per DRHP, the Indian cash management services market revenue grew at a CAGR of more than 10 percent during the period between FY10 and FY21, growing from approximately Rs 1,000 crore to Rs 2,770 crore during this period. The RCM market is estimated at Rs 680 crore in FY21 and is projected to reach a market size of Rs 2,040 crore by FY27, growing at a CAGR of 20.3 percent.
The company appointed IIFL Securities, Motilal Oswal Investment Advisors and Yes Securities (India) as merchant bankers to manage the IPO.